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tv   On the Move  Bloomberg  January 2, 2014 3:00am-4:01am EST

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at -- latvia, the poster child for austerity. >> ryan, you are watching fiat. >> should get a good bump this morning. sergio marchionne has announced that he has reached a deal with the union. he is getting the rest of chrysler that see it -- fiat doesn't already own. we will be watching that. >> shares yet the trade. we will keep an eye on that one. we are expecting to see that stock trading a little bit further this morning. caroline, you are watching u.k. retailers. >> we had a real mixed picture being painted. numbers after the christmas trading period. will that help the retailers in the u.k.. next, we get the christmas sales update tomorrow. keep an eye out for that stock, set to rise. the chief financial officer is indeed stepping down.
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it had been speculated about in the u.k. press. they are now on the hunt for a new head of the financial office. back to you. >> caroline, thank you very much. aggie to talk about. the first trading day of 2014. it feels more like that next week. let's get a quick check on the markets. to see theseing markets a little bit firmer this morning. you are seeing the ftse 100 up by 0.1%. the cac 40 up by 0.3%. some of the markets, you can see that we are getting moves on the upside. in asia, the trading session weakened somewhat by chinese manufacturing numbers. they came in a little weaker than some had expected. still about 50 for that important date of manufacturing. disappointing to some. that took the edge off things a little bit. we look at manufacturing pmi
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numbers from various eurozone countries later today. let's keep an eye on gold as well. we are seeing gold bouncing a little bit. 2013 was not a good year for gold. we have the worst annual drop in the gold price since 1981, down 28% in that one year. aswill keep a check on these well. nymex and brent both a little bit higher. we will get the european pmi manufacturing numbers later on. they are going to come fast around this next hour. this as we went up to those numbers is where we are on the foreign exchange markets. the euro/dollar currently at 1.3728. the euro just on the back of little bit. france inocus on particular and on italy, spain, all of that coming this hour and later on. certainly the focus for many will be on those peripheral eurozone countries, just how much stronger are they getting?
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just how much weaker are some of the members of the core? at thosee looking french numbers. as we look ahead to 2014, joining us now to discuss his outlook and possible surprises for the year, let's welcome the senior global asset allocations strategist at ubs investment bank. thank you very much were coming to join us. you made it through the new year festivities. we find these markets open a little bit on the upside. are you expecting another strong year for equities in 2014? >> absolutely. our call is that europe will outperform. we see a further upside in europe. japan may be the surprise in 2014. we have seen a rally in europe and the u.s.. what we haven't seen in japan is a re-rating rally. if people buy into this and start to see these reforms having a positive effect on inflation and earnings continue
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to improve, then we could see japan surprise on the upside in 2014. >> you are expecting globally to see, would you say a sluggish recovery? >> absolutely. if you look at the u.s. growth over the last 40 years, there has been a secular slowdown. we are seeing sluggish growth globally for this year and next year. it is more of a return to trend growth and fairly sluggish growth at that. it is not an amazing economic recovery but i think we could see equity outperform in 2014. maybe not as much as we saw in 2013, but still a good performance. >> i hate to be such a killjoy on the second of january, but what chance of an equity crash? equity markets came a long way in 2013. in the last trading day of 2013. we seeance that something that stalls that as early as this month western mark >> the kind of surprise we expected to have a negative
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impact on equity was the tapering. in fact, nothing happened. volatility fell. equity markets rallied. it may be that the second round of the tapering may have a bigger effect. if you look back to 1994, the first rate hike didn't have a big effect. the second one increased volatility and caused the inlapse in a poorly -- equity. we are expecting $10 billion per announcements now. perhaps the second time will be the shock. or it could be some kind of geopolitical surprise. we have seen worries of the south china sea which may cause some pullback in equity markets. >> and in russia of course as we look ahead to the sochi winter olympics. georgia andems with chechnya, that is not going to go away. they have been holding putin to rent some in some sense. also, places like ukraine with political instability and a reemergence of the strength of china. >> tell us about these
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other risk venues that you think could surprise us in 2014. things that could happen. you think it would be a surprise if gold were to continue to drop and go down to a three digit number. >> that would be one of the shocks. if you look at gold, it has fallen by 28% but two thirds of that drop has been in the three or four days after fomc announcements. it could be that policy changes from the fed will be what drives gold down further. that would have been a big shock if it falls down to three figures, but that is a possibility now as we see google talk about tapering and think about rate hikes in 2015. >> talk about m&a. going into 2013, some people had high expectations for m&a. that delivered in some cases and not in others. what would be a surprise on the m&a story for this year? >> where is the m&a wave? this time, where is it? we haven't seen it so far.
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we are forecasting that it is going to happen. we built a model that predicts there will be a 30% rise in global m&a. --h -- we expect him to be we expect it to be in technological sectors globally. recently we have this chrysler deal. we expect that to pick up, certainly. that would be a positive story for equities. in addition to the rotation story which we are expecting too. >> ramin nakisa thank you so much. he will stay with us as we get further thoughts from him as we go through the program. here is a look at what else is coming up of "on the move." ceo's deal to buy the rest of chrysler. it may have been happy holidays for john lewis but did the grinch steal christmas on the other u.k. retailers? anti-more on that as we go through the program. fat profits. how one is really company is turning krill into big-box. he did right here. we are "on the move" on
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bloomberg television. ♪
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>> this is "on the move" on bloomberg television, radio and streaming on your phone, tablet and bloomberg.com. here are is a stock that is on the move.
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let's check out what is going on in the u.k. retail sector. devon is up by 3.5%. warningued a profit that took the edge off not just their share price but some other retailers in the u.k.. many people asking themselves if it is just a tough time for enhams.wns -- deb they are talking about a last- minute gift rush, a huge surge in the last 10 days before christmas. emergely more details to on that story as we go through the week ahead. hasitalian carmaker fiat agreed to buy the remaining stake in chrysler it does not yet hold. we are getting an opening price on fiat shares. deal wouldon dollar give fiat full ownership of the third largest u.s. automaker. ryan chilcote has more. the stock is up 13%. is this a good deal for the ceo? >> clearly, investors think so.
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there is two things to this. one is the price that sergio marchionne paid. -- $4.35 billion i should say. it is less than what many people thought. a lot of people thought he would pay somewhere between $4.5 billion and $5 billion. $5 billion is what the union wanted. he upped it a little bit. the second part i think is that this is happening at all. there was that idea that there could be an ipo, that chrysler could have an ipo which was really about price discovery. the result of that price discovery was that bankers ofeed they think the whole chrysler is worth somewhere between $10 billion and $11 billion. for $4.35ing 41.5% billion. that looks consistent with that valuation. it is a good deal for him compared to what he was originally looking at having to pay.
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now he can go through with his master plan of merging fiat with chrysler. >> as you say, investors clearly like this. that solve all of fiat off problems. they are facing what is certainly a weak european car market. >> i think there is two things. it doesn't solve all of fiat's problems. recentlyen propped up by money that it was able to take from chrysler. what it does do is give sergio marchionne a lifeline to try to turn fiat around. there is $12 billion of cash sitting in chrysler that he can now access. maybe as early as the end of this month. certainly in the next couple of months, next several months. he can use that money to sort of launch his restructuring plan for fiat, try to make fiat a luxury carmaker, that is the
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idea. a map with model that people actually want to buy. it is an insurance policy to get through what is obviously a rather difficult condition for seven cars in europe, 20 year low at the moment. it doesn't mean that he is -- his actual transformation of fiat will be successful. this just buys him some time to pull it off. >> ryan, thank you very much. that fiat story getting a lot of market attention this morning. now 15%.up by still let us, ramin nakisa senior global asset allocations strategist at ubs investment bank. punchy move on fiat this morning. looking at european carmakers, do you like what you see? is this a story that you want to buy into? wax the things we are looking for right now which have a high exposure to the recovery in europe, we are going from contraction to expansion. things which have a high beat to be another would
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sector that we like, the car industry maybe not so much. as you pointed out, in europe it has been very sluggish. in the u.s., the car market has been on fire. that is great for fiat because that gives them entry to that market. they bought out the company cheap, they got a great deal. it could be very lucrative. for fiat, a could be a very good story. there are mcrae's -- micro- stories which are very good. >> looking at the flows around equity markets, you have been identifying how some money is shifting out of the court toward the periphery. this perhaps tying in with that. stock up by 15%. is that something you see continuing? more stories which are positive, we are going to see ratings upgrades for corporate in europe. we are going to see stories about growth returning. there will be stories about unemployment falling. as we start to see this positive news, that includes a kind of
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confidence in european companies. we will see more and a, more investment. the hedge funds we speak to in the u.s. are turning much more positive about europe. >> what creates the upturn? is that the u.s. economic recovery picking everybody else up by their bootstraps? or is it something the ecb is going to do that is going to kickstart things? perhaps someseen of the data picking up at the periphery but from the core, not looking so impressive. >> that is very interesting. it looks like the periphery has been forced to restructure and become more competitive. they have taken terrible pain as a result. they have had to accept low wages and they have had this internal devaluation. now they are in a much better position to be competitive in 2014 -- 2015. the periphery will continue to improve. >> european stocks will play catch up where they haven't
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quite delivered on expectations in 2013? perhaps they will do that? some other strategists were selling up through the end of , the european markets are going to pick up and the u.s. markets not so much. you think that would allow up further? >> i think the sectors look for things like banking because banking is going to have a high beat to the recovery. things to look for our national champions. there are still some banks which have bad loans. as other ones we avoid. -- those are the ones we avoid. that're just getting spanish december manufacturing pmi number at 50.8. that was 48 point six in november, quite a turnaround in terms of moving into expansion territory. let's move away from europe for a moment. you are into what is going on in china. this is one of the risks that could derail our confidence in 2014.
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>> i think one of the worries is that this credit bubble which they built up is going to pop. obviously they don't have a democracy which is very good for them because they can roll by fake out. the banks are lending to each other. i could just call the bank and say, you will lend. they are going to manage this very carefully. what is worrying us is the level of debt. we have seen growth by something like 66% over 2.5 years. now it is one third of gdp. the have to roll it over and it is going to be very expensive to do that. there will be many bad loans. they're kind of invisible at the moment. >> you these local governments have to deal with this debt? is this the kind of debt that the pressure will build and they will have to deal with it at some point or can they carry large amount of debt for a long period? >> i think what they are going to try to do is create these more transparent lending vehicles which are these long- term old and loans which are like municipal bonds in the u.s.. that will be a very positive
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thing. manage to they engineer that, that would be very positive. managing deleveraging is also very risky. there could be a blowup. it would be something like a lehman type default in china. >> it could have that significance? where do you sit on the chinese growth story right now? are people worried about what is going on in china because of the debt? are they worried about tapering in the u.s.? or is it more fundamental about the growth story coming out of these economies? >> speaking to people in shanghai when i went there in the summer, they were very worried about political instability, whether these policies would be implement it properly, whether they could manage to achieve their growth targets which were very modest. our forecast is still 7.5% for next year. unless there is a blowup in the credit bubble, we still think china is a good place to invest. >> thank you very much for joining us, ramin nakisa.
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bag for u.k.xed retailers this holiday season. find out who got a full stocking and who had to settle for a lump of coal. that is coming up on "on the move." 8:20 here in london. we will be back after a short break. ♪
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>> welcome back to "on the move ."
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here are some companies on the move this morning. south korea's two largest automakers are forecasting their weakest sales growth in eight years. competition intensifies and the stronger won embers exports. the forecast comes days after hyundai and announced a change in the u.s. where sales have slumped. shares of samsung fell as much l ig today after investment cut its price target on lower earnings after 2014. samsung's chairman is urging the company to move beyond its focus on hardware in order to maintain growth. india has scrapped a $753 million yield to buy helicopters for augusta western. a corruptionows investigation and india's defense ministry says it has them pointed -- appointed an arbitrator. it has been a mixed picture on the high street this business. debenhams worrying the market with a profit warning and has
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announced today the departure of its cfo. here with more, our european business correspondent, caroline hyde. was this move anticipated? prior to new year's eve, there had been speculation that the cfo might be leaving. shares got a little bit of a push on it. a are climbing once again today. relief that there will be a new person at the helm. we don't know who that person is. new entity will be acting as the interim cfo. simon stepping down, no surprise when the numbers have just been so tortured. warning that we're going to see a deterioration, they have been slashing their prices in the run-up to christmas up to 50% in terms of discounting. that is going to be hitting their margins. it didn't draw in the customers. just a 1.1%
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increase their. sales at debenhams really shook the market across the board. >> they certainly did. people are asking questions about how much this was a debenhams specific story. we're getting more details on that with numbers from john lewis. >> it could be more of a specific story. john lewis came out with stellar numbers. christmas sales up 7%. they saw what they call a manic monday, the 20 third of december, they were packed with last-minute shoppers. online is where the growth is, up 23%. about a third of their christmas business. what i found depressing is that on christmas day, everyone took to the tablet and smartphones to go shopping on john lewis as well. john lewis really is outperforming. >> it is that combination of online and bricks and mortar stores that seems to be doing
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well for john lewis. they are doing pretty well. where should we look? is it the john lewis story, debenhams? we get a few more updates in the weeks to come. >> indeed. january will be a fuller picture of who are the winners and the losers. john lewis numbers are early, but they say there is little doubt that this will emerge as one of the main winners from christmas. they have gained share across the board. spell maybe not quite doom and gloom for the winners, but maybe those that did have to slash their prices will see their profits down. >> caroline, thank you. joins usjeremy stretch on the program for a currency chat.
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he tells us why he is bullish on the dollar for the 2014. keep it right here. we are "on the move." ♪
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>> welcome back to "on the move ." let's get a quick check on the markets. 30 minutes and your trading day, let's see how things are shaping up. this is where the european equity markets stand right now. we are little bit weaker in the london and paris market than the early futures had suggested. a little bit lower in the ftse 100, down by 0.3%. the tax and the spanish ibex adding the best of the most upwards. one of the big stock movers in italy, in fiat.
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let's have a quick look at the currencies. euro/dollar a little bit weaker this morning. that in the run-up and in the midst of a number of updates on manufacturing trends coming through the european markets. we have had spanish december manufacturing pmi which came in at 50.8. what a substantial turnaround but not enough to push the euro any higher this morning. we will get further thoughts on that in just a moment. these other bloomberg top headlines. chinese manufacturing indexes fell in december. the purchasing manufacturers to 50.5om hsbc fell from the previous month. a separate page declined to 51. shares in china fell after the hsbc report. the british government got more than 6000 mortgage applications during the first three months of it helped to buy program. that is occurring to the u.k.
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prime minister david cameron's office. mortgages totaling almost one billion pounds have been sought under the program. jpmorgan has stopped clearing dollar transfers from the and lenders following probes into its lending. latvia is a hub for cash and adopted the euro just yesterday. for more on latvia, let's bring in jonathan ferro. new members of the euro club. >> another member. number 18 now. i think that the question being asked now is why would anyone want to be part of the euro? plenty of risk. the latvians themselves, half of them are against a joining the euro. it is not being embraced within the country. i am going to give you three reasons why they can benefit. beitics, latvia will affected by whatever happens in the eurozone if they are a part of it or not.
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for a small country like latvia, there are more benefits having a seat at the table than being outside. on the economic side, if you look at trade, you look at things like currencies, hedging. you don't have to worry about that anymore if your trading within europe. that takes away some of the risk. for businesses, what they could see is more lending coming that way. if you are looking at investors, they could be more willing to invest. officials within latvia are expecting borrowing costs to come down. is here but ify you are looking at latvian officials, they are optimistic about this one as well. if you sign up to the euro, you have got a pretty big insurance policy as well in the shape of germany who are pretty keen to make sure nobody defaults within the eurozone. >> so that is what latvia gets. what does the eurozone get in exchange? >> i think this is probably one of the more interesting things. there are going to be risks for the eurozone.
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there is some concern there. apart from they fuel injection into the pr machine, i think this is where it gets interesting. it is a country that saw its innomic output shrink by 1/5 2000 eight/2009. -- 2008/2000 nine. it is now the fastest growing country in the eu economy. the likes of germany looking to keep countries in the south on the straight and narrow. that may enable them to do that. it is not a market moving event right now. this is steeped in politics. >> john, thank you very much. , let's welcome jeremy stretch. happy new year to you. the latvians joining the eurozone, it is still a club that countries want to join. >> it is. as wek during the crisis were discussing, it was much the
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case that it was perceived as a lifeboat. joining a larger currency group was safety. i think there are still question marks about that strategy. there are signs that the euro, he is growing -- euro zone economy is growing faster. i will provide a degree of comfort for latvia. everything does come with costs attached. the lessee will continue to be driven by what is being necessary as far as that eurozone project. it is not a straight win win as latvia is concerned. it will be interesting to see how they perceive the process going forward. >> what does the new year hold? the ecb will be busy on its asset quality reviews. will we see them wanting to inject more liquidity into the system? will they take any action at all? deposit rate cuts to try to turn things around in the eurozone? >> i think it is not just the recovery story that the eurozone needs to be considering. it is also the deflation or
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disinflation that is relevant as far as the eurozone is concerned. we continue to see labor markets under a great deal of stress in a number of jurisdictions. we will probably see the differential between french and german economic activity being written large by purchasing managers indices. that is an important dynamic. a quality review going forward. there are some question marks about the brazilians going forward. that will require some degree of capital injection from the ecb. we may well find they have to start expanding management again rather than contraction. >> does the direction for currencies and 2014 have a lot to do with central-bank policy as it did last year? is it going to be a year where we see divergence between what the fed is doing and the ecb and the bank of japan? >> possibly yes. policy, yes.
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alongside that comes the macroeconomic environment as well. if we have the u.s. having every , we arerowth number penciling in a 3% growth number, that will feed into the expectations of what the fed will do in terms of tapering and further expectations about indirect or direct policy further down the track. that will be favorable for the dollar. you will continue to see the ecb being very much in an easier stance. the same sort of policy for the japanese. ar the japanese etiquette is little more interesting. as the yen continues to weaken, that throws up more issues. you were talking about some of those korean companies which are finding it increase or will -- increasingly difficult to compete. that may well stem the slide of the yen as the go north of 106 and further. >> will a weaker euro help european businesses compete? that is something that a number of eurozone companies were quoting.
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there companies had been affected negatively by the strength of the euro. >> the euro is moderately undervalued. -- moderately overvalued. any degree of easing in the valuation will help alice sheets. -- balance sheets. the ecb will never admit that they would be happy to see a slightly weaker euro. think that will be the subtext of some of the debate going forward. a weaker euro will help balance sheets but it will also help to ease disinflation array fears. >> the bank of england's activities and stronger data out of the u.k. economy have been strengthening the pound. is the bank of england going to lean against that? >> it is fascinating because mr. carney has been issuing this forward guidance and you can argue that without that the markets would be already pricing , somewhat further advanced in
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that process. i think the bank will continue to lean against the expectation of monetary tightening. sterling is acting a little bit of a headwinds to the recovery story. there is a case to be made that the eurozone needs to go lower. i think that will act as a headwinds but not a total impediment to the prospect of rebalancing. the u.k. economy is going to have growth relatively unbalanced. >> and you like the dollar and 2014. you like the mexican peso because of the spillover from the u.s. story. >> i think the north american story will look constructive through the course of this year. the u.s. will have very strong growth. we have less fiscal tightening through this year. we will continue to see the labor market growing. that will spill over into the rest of north america. when you overlay that with energy reforms in mexico being pushed through, that also
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provides some opportunity. looking at the mexican peso weinst the euro for example, think the mexican peso will perform strongly. >> jeremy stretch, thank you very much. ahead, we will dig into the fiat-chrysler deal to see what is going on. stay with us. we are "on the move." ♪
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>> i am anna edwards in london. this is "on the move" on bloomberg television. the final rating for european factory output are released across the european union this morning. david tweed is following them from berlin. what do we have so far? we have numbers out of spain, also sweden and ireland. these are important numbers to look at. they are the final numbers but we do get a little more detail about what is going on with
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regard to manufacturing from the purchasing managers who are surveyed. 5000 are surveyed by market economics. 3000 of them put in manufacturing results. to me just give you ireland. those numbers were fresh and they did show a six-month expansion in manufacturing activity in ireland. the number we got for december, 53.5 versus 52.4 in november. purchasing managers who were interviewed said it has been driven by export demand. the main destinations for those irish exports, china come of the u.s. and the u.k. the other important information coming from ireland is the fact that we are seeing seven months of job creation. unemployment levels in ireland are declining from 15% to around 12 point five percent. obviously, too high. still too high. numbers from sweden, just
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indicated that the pace of expansion has slowed but we still have an expansion going on in manufacturing. you mentioned spain of course. spain, 50.8%. that is in-line with expectations. it does show an improvement in spain in four of the five -- past five months. we have numbers coming up later from italy, france and germany. france is someone to watch. going on there since february, 2012. the numbers do bode pretty well in 2014. >> just getting those numbers from italy as we speak. 53.3, so expansion in that part of the periphery as well. we saw expansion coming through in the spanish market against contraction the month before. an interesting discussion as you have been saying. here are some of the companies that are on the move this morning. devon hams' cfo is resigning.
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hams' ceohams -- deben is retiring. john lewis reported less than expected growth in holiday sales thanks to online orders. revenue at the you k's largest department chain rose more than 7%. online forrdered pickup purchases in the stores. fiat has agreed to buy the remaining stake in chrysler owned by the united auto workers. the $4.35 billion deal will allow the companies to merge and form the world's seventh largest automaker. this comes less than five years after chrysler entered bankruptcy. let's get more on that story. we will bring in matt campbell. he covers european m&a for us. ryan chilcote with us who has been covering the story. the investors in fiat certainly like what they see this morning.
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>> absolutely. shares were up mike more than 15% at one point. if this continues, shares are on course for their biggest percentage increase since april 2, 2009. pretty extraordinary. this was a single digit in dollar terms, billion dollar company. it has just become a double- digit. now, fiat on the italian talk exchange is worth about $11.5 billion. they have an upper limit of 10%. stock exchange says they open anyway. they will review it throughout the day to see if it needs to be suspended. >> it did take a while to open up. matt, happy new year to you. thatdy feeling foggy and this morning? this is a complicated deal to get your head around. explain to us how this is going
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to work. >> the market seems to be saluting the complexity. sergio marchionne, the ceo of fiat is operating like a private equity manager. chrysler, the target of this transaction is actually paying back the -- paying effectively for its own acquisition. >> that sounds clever. >> it is very clever. fiat is putting up a very small amount of money in the grand scheme of things. as a result, fiat gets control of a very successful u.s.- focused on a brand. that helps reorient it away from the european auto market which as we talk about all the time, is really going nowhere fast. >> where is the focus for fiat in terms of where it is selling cards? it is trying to build more on the luxury end of things. >> it is. when i was a kid growing up, seeing a fiat was a curiosity. it was not a car you would generally see. the fiat 500, the little car you
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see around london is now being marketed heavily in the united states. there are going to be more models to come lust for luxury brands like maserati. also, this is about sharing the things that we as consumers don't necessarily see. technology, development, pulling marketing spend. >> this doesn't solve all the problems. >> i think perhaps the bigger winner in this would be fiat. obviously, fiat is the one losing money at the moment. it is only thanks to chrysler that the combined group is able to show a profit. more importantly, what if this merger goes through? it is now almost certain to. no problem with an ipo, adding the merger. they can now access the $12 billion cash pile that chrysler has got. they can reinvest in these italian factories to try to make something happen, this made in italy idea on the luxury end.
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it is probably fair to say that this is a lifeline for marchionne and not a solution in itself. i still have to make the cars that people want to buy. his plan sounds nice but we have to wait for this retooling to go through. in a now, they are difficult position. >> how american does this make fiat or how italian does this make chrysler? >> on the whole, this makes fiat more of an american company for sure. the u.s. market aside from china remains the most important automotive market in the world. chrysler as well as other u.s. automakers have had quite a rebound in the u.s. as the economy picks up. the european auto market remains very much in the doldrums. is, how much disengagement from italy we see out of fiat? sergio marchionne is very much a detroit guy. he lived in canada for a long time. his focus is on the u.s.
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will fiat headquarters leave turin for detroit? >> real political hot potato in italy. >> thank you both very much. 8:50 here in london. krill is, krill, yes the preferred food of wales. it is also feeding the profits of one israeli company. more on that after the break. ♪
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>> welcome back to "on the move ." in hungary, they like nothing more than a few large mouthfuls of krill. -- wales when they are hungry like nothing more than a view large mouthfuls of krill. elliott gotkine reports on one of the latest israeli companies to take this by storm. rations grewcrust mighty companies. enzymotecranzym -- hope so. >> you can smell the krill. it gets poured into these reactors where the lipids are extracted. it is eventually sold and turned into a nutritional supplement. at people with high cholesterol and stiff joints. they are also in the business of nutrition and medical food. get intoooking to
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prescription drugs. having all three under one roof is a winning formula. [indiscernible] growth was about 50%. if you take the last nine months, it is 80%. and thisry confident is only the beginning. >> investors agree. shares have more than doubled. that doesn't mean there is no possible downside. in a recent note, jeffries said the shares are already discounting earnings growing more than fivefold in 10 years. there is a risk of new studies critiquing the health claims of nutritional ingredients, possible litigation, or regulator parameters shifting. then, there is grappling with getting bigger. have is tok that we
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be able to continue management of the company. we are a very diversified company. we are not dependent on a single rod that or a single market. challenge is for management. we continue to manage the company and deliver our profits. a enzymotec is still just tiny crustacean in terms of size but this is one company with its sights set on becoming a lobster. elliott gotkine, bloomberg. >> it might just be the first trading day of 2014 and we are already getting an early look at how manufacturing activity is developing. these numbers for december rent areas countries in europe. german manufacturing pmi come in at 50.3. the french number, certainly looking like a laggard. it came in at just 47. he had better numbers coming
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through an expansion territory for italy and spain. stay with bloomberg television. "the pulse" is up next. ♪ .
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>> fiat finally takes control of chrysler. shares sore as milwaukee union marchionne bias them out for $3.5 billion. >> sampson's in strategy. they want to company to move beyond hardware in order to beat apple. good morning, everybody. welcome. you are watching "the pulse" live from bloomberg's european headquarters in

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